I have an existing Windows 2003 network. I am adding a new Windows 2008 R2 server whose primary role will be a RDP/terminal server. We have two existing 2003 servers that are both DCs and GCs. One is an Exchange server and VPN server. The other is the primary file, print, and database server. Our group totals about 15 users with two full-time remote users, and regular remote access by other users on the road. I installed the new server, started to activate it, and got the message: "Windows Activation - You have entered a Key Management Service (KMS) key that should only be used to create an activation infrastructure for an organization. - Click 'OK' to use the KMS key, or click 'Cancel' to enter a different product key." I am not sure of the best way to proceed. We have always just had the standard Windows Activation over the Internet in the past. I've pulled up documents on "adding a server 2008 domain controller to an existing 2003 domain," and "Volume Activation Deployment Guide for Windows 7 and Windows Server 2008 R2." I'm a bit confused about the options. - Somewhat unrelated: If I leave the 2008R2 server as a memeber server, do I have to worry about schema extensions and such- What is the real-world difference between MAK and KMS activation- Is setting up a KMS host a super simple follow the prompts, or is it as complicatedas the Volume Activation Deployment Guide makes it look?- Will setting up a KMS host change the way my existing servers work?- What are your experiences in this area? For a very small office, is there a best choice? Sorry for the basic questions, but I'm posting first and tonight I'm going to dig up documentation on this. I've basically ignored licensing technologies up to this point and let the OS do what it wanted. I guess I need to read up on MS licensing technologies so I understand what I'm doing. Any input that will steer me in the right direction and keep me from wasting time looking into options that don't make sense would be appreciated.Thanks,Jeff

Hello Jeffery Smith,I would suggest that you use a MAK key rather than a KMS Host Key.MAK allows you to activate multiple machines over the Internet with that one key, the total is dependant on the licensing program with which you acquired the product key.KMS activation allows you to activate your machine internally against a KMS host which you set up on your internal network. For Windows Server 2008 and Windows Server 2008 R2 you would need 5 machines before the count would be high enough to activate. So you would need to install at least 5 machines and possibly 6, of Windows Server 2008 \R2.The Key you are using is a KMS host key, this enables that machine to be a KMS host, other KMS client machines would attempt to contact the KMS host ( It registers with DNS) to actvate rather than activing over the InternetThanks, Darrell Gorter This posting is provided "AS IS" with no warranties, and confers no rights

Darrell,If I understand you correctly, the KMS system is more for large organizations that have large numbers of servers, don't want all kinds of activation traffic going out of their network and/or want to manage this internally. Are MAK keysthe traditional method where you connect to the microsoft servers to activate??Are there any down sides to using MAK keys? If so, is the KMS setup difficult and/or high maintenance? Can I even use the KMS since I only have 3 servers? I will most likely go with the MAK key as you suggested, I'm just satisfying my curiosity now.Thanks,Jeff

Hi Jeff, I suggest watching the videos on the following site to have a better understanding of KMS and MAK: http://technet.microsoft.com/en-us/library/dd996588.aspx To use KMS, you need at least 5 KMS clients. Since you only have 3 servers, to use KMS, you must setup another 3 virtual machines working as KMS clients. Tim Quan - MSFT

Hi Jeff, How are things going? I have not heard back from you in a few days and wanted to check on the status of the issue. Please let me know how things turned out. Tim Quan - MSFT

As you and Darrell suggested, I use the KMS activation. I tried to watch the video, but my DROID did not want to play it. Is there an MPEG version of the video out there? Thanks to you both. I'm on my way to setting up a nice new Terminal Service server.Thanks,Jeff

Hi Jeff,I am sorry we do not have an MPEG version of the video. You may use a computer instead of a Droidto watch the video.Tim Quan - MSFT